What are my Code obligations when assisting clients to estimate their turnover to determine their eligibility for the JobKeeper Payment?
Under the Code of Professional Conduct (Code), you must take reasonable care:
- in ascertaining a client’s state of affairs, to the extent that ascertaining the state of those affairs is relevant to a statement you are making or a thing you are doing on behalf of a client; and
- to ensure that taxation laws are applied correctly to the circumstances in relation to which you are providing advice to a client.
For further information about taking reasonable care, refer to our information sheets:
- TPB(I) 18/2013: Code of Professional Conduct – Reasonable care to ensure taxation laws are applied correctly
- TPB(I) 17/2013: Code of Professional Conduct – Reasonable care to ascertain a client’s state of affairs
Will I be in breach of the Code if there is a mistake in the client’s turnover projection for the purposes of JobKeeper Payment eligibility?
Not necessarily. Where information provided by a client seems credible (and for existing clients, is consistent with previous statements) and you have no basis on which to doubt the information supplied, you may discharge your responsibility under the Code by accepting the statement provided by the client without further checking.
However, if the information does not seem credible or appears to be inconsistent with a previous statement, further enquiries would be required. In this case, taking reasonable care may mean asking ask questions of your client or examining the client’s records, or both.
When applying the tax laws, there is no set formula for what it means to take reasonable care in any given situation. However, it may include you referring to further material to ensure that they apply the tax laws correctly to their client’s circumstances. Such material could include:
- legislation and related extrinsic material (for example, explanatory memoranda to Acts)
- any other guidance material published by the Australian Taxation Office (ATO), including on its website
- information published or provided by a recognised professional association or other relevant regulatory agency
- publications, information, advice or commentaries published by other experts, registered agents or specialists
- another registered agent or a legal practitioner who has the ability and expertise to provide the advice on taxation laws and/or
- relevant training material.
It is important you keep records of the information you relied on and your calculations.
The ATO’s guidance is that if, at a later stage, it eventuates that the client’s actual turnover for their test period is greater than the prediction of their projected turnover, the client does not lose access to JobKeeper. The ATO will accept your assessment of these turnovers unless they have reason to believe that the calculation of the projected turnover was not reasonable.
If there is a significant difference between the projected turnover and what eventuates, the ATO may need to assess whether the assessment was reasonable, so it is important that you keep good records of your calculations.
However, should the TPB become aware that the ATO has made an assessment that the calculation of the projected turnover was not reasonable and you assisted your client in the calculation, the TPB may consider if you have breached the Tax Agent Services Act 2009 (TASA), including the Code.
What are my TPB obligations when providing a 10% decline in turnover certificate for the purposes of the decline in turnover test in the Fair Work Act 2009?
Tax practitioners continue to support their clients to lawfully access COVID-19 related stimulus measures. One such measure is the recent extension of the JobKeeper amendments in the Fair Work Act 2009 which will give certain employers access to temporary flexibilities to manage their business operations and employees.
Employers who previously participated in the JobKeeper scheme but do not qualify for the extension of the scheme and wish to access these temporary flexibilities will need to engage an eligible financial service provider, specifically, a tax or BAS agent individual, company or partnership or qualified accountant, to obtain a certificate that demonstrates that their business has suffered a decline in turnover of at least 10% for the relevant quarter.
In providing this service, practitioners are acting under the Fair Work Act 2009 and as such, this is not a tax agent service for the purposes of the Tax Agent Services Act 2009.
The Fair Work Ombudsman has responsibility for enforcing compliance with the JobKeeper provisions in the Fair Work Act 2009. However, should the TPB become aware of any serious misconduct by a registered tax practitioner in relation to the provision of a 10% decline in turnover certificate, the TPB may consider whether the alleged misconduct gives rise to a finding that the registered tax practitioner is no longer a fit and proper person and/or whether the registered tax practitioner has contravened the Code of Professional Conduct, in particular, Code item 1, which relates to honesty and integrity.
For more information about the 10% decline in turnover test and certificate, and a template certificate, refer to the Fair Work Ombudsman’s website.
My client has incorrectly been receiving the JobKeeper Payment – if required, who is liable to repay the JobKeeper Payment?
If it is later determined that your client is ineligible for the JobKeeper Payment, any resulting overpayment may be recovered by the ATO, directly from the client. To ensure that your clients understand that they will be personally liable, you should have in place a written agreement.
Ideally, this agreement would form part of a letter of engagement. While not required under the TASA, the TPB strongly encourages the use of letters of engagement as a means of avoiding uncertainty and misunderstandings and to assist in compliance with the Code.
Where a letter of engagement is not in place, an alternative written agreement or declaration by the client would be appropriate to ensure that there is no misunderstanding.
For further information about letters of engagement, refer to our practice note TPB(PN) 3/2019 Letters of engagement
I am managing the JobKeeper payment for my clients and will be making the monthly business declaration to the ATO on their behalf - what are my obligations?
As an approved form, each time you lodge the monthly business declaration on behalf of your clients, the law requires you to have first received a signed declaration in writing from your client. The client declaration must state both that:
- they have authorised you to lodge the declaration; and
- the information is true and correct.
Your client is required to retain the declaration (or a copy) for up to five years, depending on their circumstances. We recommend you also keep a copy of the declaration.
This requirement also aligns with the Code, which requires that, unless there is a legal duty to do so, you must not disclose any information relating to a client’s affairs to a third party without the client’s permission.
When you make the monthly business declaration, you are disclosing your client’s affairs to the ATO, which is considered a third party. Therefore, you must obtain your client’s permission to provide the required information to the ATO.
For further information about your obligations under Code item 6, refer to our information sheet TPB(I) 21/2014 Code of Professional Conduct – Confidentiality of client information
You can put in place a range of measures and processes to exercise sufficient supervision and control over staff when working remotely.
Refer to Exercising supervision and control when working remotely for further information.
Last modified: 22 September 2020